Nigerian fintech, Moniepoint has been granted permission by the Competition Authority of Kenya (CAK) to purchase a 78% share in Sumac Microfinance Bank, opening the door for its entry into the highly regulated banking industry in the nation.
Just five months have passed since Moniepoint’s previous effort to acquire a payments company, KopoKopo flopped. The fintech company will get access to Kenya’s lucrative mobile payments sector, valued at an estimated $67.3 billion (KES 8.7 trillion), through the merger, which is still pending Central Bank of Kenya (CBK) approval.
Continuing, it also indicates a trend in which more fintechs are avoiding the drawn-out and unpredictable process of obtaining regulatory permission by purchasing licensed local players.
According to a CAK statement from BrandSpur banking and finance news desk: “As per the parties’ submissions, this transaction will not result in negative public interest issues. Specifically, there will be no employment loss, and all the current employees will be retained under current terms.
“Premised on the above, the authority approved the proposed acquisition of 78% shareholding of Sumac Microfinance Bank Limited by Moniepoint Inc. unconditionally,” the statement released on Monday added.
About Sumac
Sumac was first established in 2002 as a small investment organisation and has since grown into a registered microfinance bank that provides services like currency trading, money transfers, and SME loans and deposits. According to CBK, Sumac is a medium-sized microfinance bank with 43,800 active loan accounts and $8.1 million (KES 1.05 billion) in assets, accounting for an estimated 2.8% of the microfinance market. Targeting company entrepreneurs excluded by traditional banks, it first became available to the public in 2004 under the name Sumac Credit. Ten years later, it obtained a Central Bank of Kenya microfinance banking license.
About Moniepoint
Founded in 2015 by Tosin Eniolorunda and Felix Ike, Moniepoint is located mostly in Nigeria and is registered in the United States. It does not have a base in Kenya, but it is present in the United Kingdom. The Competition Authority of Kenya authorised Moniepoint’s proposed acquisition of KopoKopo, a regional fintech that offers small company loans, in August 2024. But soon after, the agreement fell through, and neither side revealed why.
